Hi everyone, thanks for being here. I'm Aravinda Galappatthige. I'm one of the TMT analysts here at Canaccord Genuity. Very pleased to have NTG Clarity to give us an update, the first time in Boston. NTG is a digital transformation company focused at this point predominantly in Saudi Arabia and seeing a genuine inflection point in terms of revenue growth. I have with me Adam Zaghloul, VP of Strategy and Planning. Adam, thanks for being here. Thank you very much. Great to be here, Aravindra. Maybe I'll just start with the breakout years that you've had in recent times. NTG Clarity has been around for a while, but it's really the Middle East strategy that created that inflection point for you. Maybe just take us through that history a little bit, and then we'll get into the more current aspects of the business. Okay, right on. Yeah, that definitely is a really good place to start. You know, NTG Clarity has been listed for more than 20 years now on the TSX Venture Exchange, so we have a long history. We started out in the 1990s and 2000s as more of a telecom services company based out of Canada. Our customers were Canadian telcos. We were doing network design, telecom engineering, outsourcing, software development for telecom operators. At the same time, a lot of the management team and founding team are Egyptian by nationality. We naturally had some ties in Egypt and in the Middle East to be able to get some business in there, even going as far back as the early 2000s. As a lot of technology and telecom investment happened in the Middle East, we were able to grow that segment of our business to the point where it became the majority of the business. I really think the inflection point that we hit over the last few years is because of three main factors. The first is, number one, it's recognizing that the software developers that we were servicing telecom operators with could really be used for anybody, financial services customers, yes, telecom operators, but also system integrators that are servicing basically any large enterprise organization. Opening ourselves up from being pigeonholed in telecom to really becoming sector agnostic was a big part of it. Another one was being in business for more than 20 years in Saudi Arabia, we got a lot of relationships built with key decision makers in the IT space there. We were able to leverage that Rolodex. Many of the contacts would have moved on from telecom to work in other IT organizations in other sectors as well. We were able to open that Rolodex, get business in other sectors, and grow that way. Foundational in the NTG Clarity growth story is the Saudi Vision 2030, right? There is a huge emphasis on building out technology and technological infrastructure in Saudi Arabia, and a huge amount of government investment is going into that. Really, the stars aligned, and we were able to deliver what ended up being a 60% compounded annual growth rate of revenue over the last three years. One of the things I've noticed is that as you kind of track those contract sizes and the terms, they're getting larger, almost like big jumps in terms of the contract sizes, but also the terms are extending. Some of them are up to two years, three years, and so forth. Maybe just talk to that aspect of it. What are the dynamics there? Yeah, definitely. We're really excited to see over the last few years, customers being more and more comfortable signing on for longer-term engagements for larger engagement sizes. You know, what's core to our strategy is really this sort of land and expand business model, right? We'll start off with a small engagement with a new customer. Oftentimes, they're referred to us by existing clients. We get a lot of new business through word-of-mouth referrals. We'll start off on a small engagement, and we'll place with each customer a dedicated account rep. They'll be on site with this customer every day. They'll learn their technology infrastructure, and they'll be able to work with the customer to identify gaps and opportunities where NTG Clarity can work with them, be it, you know, a team of 10 resources that need to do this project, or maybe even some of our proprietary software products that could be a good fit for the customer. We're basically able to work with them to grow the engagement. We've seen really good results with the land and expand. As of Q1 2025, the average customer engagement grew year- over- year by about 60%. Definitely a large growth lever is that expansion of engagements with existing customers. When you talk about customers, I realize you can't sort of, you know, give specifics, but give us a sense of who the customers are. I mean, Saudi Arabia, you know, we know, you know, virtually every large company or most of the larger companies are semi-government at some level or another, but just a sense of who your customers are and the kind of type of work you do for them. Yeah, for sure. A lot of our customers, especially the ones that we're expanding our budgets with effectively, are these sort of large enterprise customers, be it, you know, just as an example, probably the largest Islamic bank in the world is our customer. One of the top three Saudi insurance companies is our customer. All the big telcos over there are customers as well. These are huge blue chip companies that have a large IT budget that we can work with them to expand and take a larger proportion of. That's the reason why we've been growing so fast. I want to point out that while our bread and butter is these large enterprises, we're also doing a lot of work with smaller companies in Saudi, small and medium-sized businesses who we serve more with our NTG Apps software offering. It's more tailor-made for them. A huge part of the Saudi Vision 2030 is an emphasis on building out a more robust small and medium-sized business infrastructure and ecosystem, rather. We're looking forward to being a huge part of that as well, supporting them in their growth. Okay, so maybe just take us through. I mean, if we think about one of your larger customers, you do perhaps a more limited engagement at the outset. You come back with a bigger deal. When you think of the size of the enterprises, you can even imagine $100 million type contracts, right? What's sort of the limit? Do you have to expand what you do in terms of the nature of your products to kind of go beyond a certain point? Or is your core digital transformation work adequate to get you to three, four, five times the type of contracts you're winning right now? Yeah, that's a good question. I would say in terms of product offering, we're at a pretty good stage right now. At the end of the day, we are supplying what is pretty foundational to our customers' needs. They are the software developers that are building the end-to-end solutions that are digitizing Saudi Arabia as a whole. I would say that software we're offering is really well suited for the Saudi market. That being said, we're going to have to continuously invest into the expansion of that specific business model. You can have all the connections in Saudi Arabia like we do that you want, but at the end of the day, especially on the talent side, we're going to need to recruit, hire, onboard talent to be able to serve these new contracts. You start to see that in the investments that we've been making, especially in this year. We've been investing a lot into talent, into new office space to support some of the new contracts that we've been seeing. We expect that to be the trend as we continue the growth going as well. Okay. I think we've talked about this in the past, the actual size of the Saudi Arabian market. I've seen estimates as high as 70, 80. I've seen 40. I think you've talked about 50. How should we kind of size up that market? Think about, obviously, the growth is there too. It's not just about what the size is today, but any sense, you being on the ground, how big that market is right now? Definitely. It's an exciting point. You know, the Saudi information and communications technology market is huge. I've seen estimates as of 2024, like you said, $50 billion right now. NTG is 0.1% of the size of the market. There's a huge amount of room to grow. Again, like you mentioned, the growth is also there in the market. All the government investment, all of the even private sector investment as well, going into expanding the market is growing at about an 8.5% compounded annual growth rate every year. Some estimates put it at $80 billion-90 billion by the time 2030 is achieved. It's a large market and it's growing rapidly for sure. You think about the growth, you think about the size of the market. Naturally, that attracts competition, that attracts all the other IT services companies. Are you seeing that? Is there, I mean, where are they operating? What's been sort of the dynamic from that front? There definitely is attracting some competition. I mean, you think about the market, you know, it's growing rapidly, like we described. It's also largely uncorrelated to the North American market. Uncorrelated growth is definitely something that's going to be attracting competitors as well. I guess to make the trifecta, it's going to be basically the Saudi tech talent pool isn't as up to train standards, right? It's still pretty immature and growing. They need to look externally to companies like NTG Clarity and some of our competitors to get these services. You're seeing some competition come to town just in the last couple of weeks. You saw TELUS Digital open an office in Dubai. The competition is coming to town. At the end of the day, it's not really much different than what we've experienced in recent years, which has been competing with the large multinational IT services companies like Accenture and IBM and Tata. We tend to edge them out on a couple of factors, right? They tend to bring to town the more standard Western style offshoring, which is based out of, say, places like India and Pakistan. NTG Clarity's model being based out of Egypt definitely gives, especially our Saudi and Gulf customers, yes, some cost savings up to 50% when you compare to hiring on site in Saudi Arabia, but also the sort of cultural aspects that you get. Egyptians will speak the same language, work in the same time zone, share a general cultural background. It makes collaboration really good for our Saudi customers as well. We edge them out on that. Also, the amount of time that we've been in business in Saudi Arabia, right? Instead of moving in the last few years, we've been doing business there for 20 years. We've got the connections and the network to be able to secure some new business there. At the end of the day, price is a huge factor. If you're going to hire a multinational, you're going to pay multinational prices. NTG Clarity can oftentimes, even though we're working out of Egypt, compete on the pricing and come in at, say, 70% of one of those large multinationals as well. We've got a lot of strengths going for us. How sensitive are they to pricing? I know that in the IT services space here or in North America, it's getting crowded and pricing's seeing some pressure. I suspect in the Saudi Arabian case, they're looking for execution, right? I mean, everybody wants it to be economical. Are you seeing a lot of sensitivity on that front, which probably helps you, but... Yeah, sensitivity to pricing? Yeah. I mean, it's interesting to see the dynamic. Definitely cost is a consideration like it is for everybody. Especially what the Saudis are focused on is results. They've got a large amount of investment that's available to them in the form of their oil revenues, and they're really looking for quality talent to produce quality results. Oftentimes what we see is our customers' number one priority is, are these employees going to have the skills and are they going to be able to integrate into our teams? Cost is oftentimes a secondary consideration for them as well. Yeah. In terms of once you've landed these customers, you certainly don't want to be in a situation where you kind of take a step back with these large enterprises. In terms of assessing their satisfaction and hitting those key metrics, call it their NPS scores, what kind of tracking systems do you have? Yeah. We track a lot of KPIs around customer satisfaction at the highest level. You know, customer retention speaks volumes for sure. Taking a look at the difference, if you take a look at customers in 2023 versus customers for the year 2024, we had a 90% customer retention rate. The vast majority of our customers are liking our services. What we also look at is that expansion of their contracts, right? I mentioned in the first quarter, we saw average contracts or average engagements increase in size by about 60% as well. Not only are our customers liking us enough to stay on, they're liking us enough to significantly increase the scope and duration of their contracts as well. That along with telling their friends, a lot of our new business comes from word-of-mouth referrals, indicates to us that the customers are really satisfied for sure. Okay. Maybe we'll just touch on the talent side, I mean, the supply side of the business, because that's, I think, an impressive element of the business. Maybe just give us a little bit more background as to sort of how your infrastructure in Egypt was set up, how that's being scaled, and sort of how much capacity there is going forward? Definitely. Okay. The talent side is a huge consideration for us, right? We've got the relationships that we need to get a lot of new business in Saudi Arabia and the Middle East itself. Again, when you get the contracts, you've got to fill the seats. Talent is a huge consideration. I think the amount of time that we've been in business really works to our favor in Egypt, because if you think about what we're offering to candidates who are going to be working for our customers, it is a highly sought-after and well-compensated job in software development and IT, which our employees definitely really like. We've come to be known as a preferred employer in the region too, right? Not only are you getting a highly coveted IT job, you're also going to work in the Gulf, which is Gulf states like Saudi Arabia, much higher cost of living locations than Egypt. You definitely get a command and a premium on salaries working there. It's almost like we're bringing the American dream to Egypt, right? That's how a lot of our employees see us when we're working in Egypt. We have that long history and goodwill that comes along with recruiting in Egypt. We also are pretty active in community involvement as well. We run a lot of university and college training programs based out of Egypt for new grads and their university students as well, letting them know all the possibilities that there are to work in software development and IT. We even took it as far as opening our own high schools in Egypt. We've got two vocational high schools opened in Cairo right now that basically expose high school students to a dual curriculum of regular high school subjects, math and science, but also more specific software development curriculum like software development, circuit design, engineering, all that kind of thing to get them interested in the sector. Hopefully, they'll come work for us when they're done their studies at the end of the day. When you think about the talent pool in Cairo itself, I know it's a big population. It's like 18 million, 19 million, I think, in terms of population. Do you feel that Cairo alone has the capacity to sort of meet your demands when you think about what it'll be five years ago? How long do you plan when it comes to... Do you have... Are you thinking back up in some of the other regional areas? Yeah, that's definitely a good question. Cairo is a huge city, basically a mega city. Egypt as a whole, a population of over 100 million, is a huge country as well. I think especially importantly is it's sort of a tech hub for the region, right? A lot of the top technical universities are based in Cairo and in Egypt as a whole. There is a strong talent pool and a strong pull from basically all aspects of Egypt or all areas in Egypt to come to Cairo to get a job in technology as well. We're pretty confident in the ability to supply talent just from Cairo as well. Maybe we'll just touch on the financials. You grew revenues 100% last year, I mean, around about 800%. I think the guidance suggests, you know, as you said, sort of 60% growth. You kind of upped the guidance a little bit last quarter. Can you talk about how sort of the model operates when you're growing at this rate? Obviously, your margins are still good considering your growth rates, but there has to be an investment in recognizing sort of the capacity you have to build. Can you just walk us through sort of what the model looks like, including from a margin perspective? Yeah, for sure. The model works. At the end of the day, it's a pretty simple model. We've got resources that are working for our customers. They're on a contract anywhere from one to three years, and we bill our customers monthly based on the number of resources that are deployed with them, right? That's basically how our revenue works. When you start thinking about margin profiles, starting at the gross margin line, we see it's pretty typical, 35% - 40% gross margin, depending on the mix of our offerings. Offshore might be a little bit closer to that higher end of the range. On-site resources, where they're working in person in the customer's offices in Riyadh, might be a little bit towards the lower end. Of course, our NTG Apps software offering has more software-style margins as well that might bring it up closer to that 40% and beyond. 35% - 40% is a pretty appropriate range that we expect to see gross margins track to. Below the gross margin line is when our investments into scaling the business start to make themselves manifest to people. In an ideal world, we'd hit maybe like sales being 5% of our revenue and G&A being 10% of our revenue. In reality, how our business model works is, when we first hire, train, onboard new resources before we place them with customers, they'll be sitting in our G&A line. Once we deploy them, they'll hit cost of sales and have billable revenue against them. We'll see investments into roster basically start to have a little bit of an impact in margins. We saw that in Q1 2025, right, where adjusted EBITDA margins were probably closer to 15% than, say, back in 2024 when we got the mix just right. It was closer to a 20% adjusted EBITDA margin. As we grow, we hire new employees. We have to build out some new office space to house them. We'll see a little bit of contraction on those profitability metrics for sure. When you think about, I know that, you know, you can't specifically refer to recurring revenues, but I think you've talked about reoccurring, sort of coming back. Maybe just talk about that split a little bit, how you think about it, how to sort of build. I know that NTG Apps is a big part of it, you know, something you've been involved with. Maybe sort of develop on that product as well, you know, how that's unique to the offering. Yeah, for sure. I'll start with the NTG Apps offering. NTG Apps, you can think about, is a software offering. If you're familiar with no-code, low-code, that paradigm, it is really similar to those types of offerings. Basically, our customers can deploy enterprise-grade applications without any development themselves. It can be anything from a full-scale enterprise resource planning platform that we've rolled out for a lot of small and medium-sized businesses, all the way down to more niche use cases like IT ticketing and field service management and those kinds of things. What's exciting is the team's done a pretty good job getting our existing customer base using NTG Apps. Our traditional bread and butter services are those software development services. We've gotten, as of 2024, just under half, 47% of our customers to at least pilot NTG Apps, the software line. It's resulted in what we see as those sort of pilot projects turning into full-on projects. In Q1 2025, we saw 150% year-over-year growth in the NTG Apps line. It's definitely something that we're looking forward to pushing more. What comes with it is, yes, revenue growth, additional revenue growth, but also the potential to expand gross margins, right? Right now, NTG Apps' gross margins for those projects are in the neighborhood of 50% just because it's an early-stage project in development. Longer term, they could hit software type margin profiles, be 60%, 70%+. It'll bring some margin expansion with it as well. In terms of the licensing agreement, once you sell the, once you sort of place NTG Apps, is that an annual kind of almost an automatic renewal kind of thing? Yeah. Is that how it works? Yeah. Typically, NTG Apps projects, you'll have sort of like a licensing agreement that you'll pay annually. You'll pay for support and maintenance annually as well. That's tied into the licensing agreement. What our customers are also engaged on us with is the professional services side to implement NTG Apps as they see fit, integrate it with other applications in their software stack because it is fully integratable with other applications that they're using as well. We'll get a little bit of also professional services revenue on top of the annual recurring licensing aspect of it. If you think about our revenue mix, right, like yes, NTG Apps plays into what you can consider recurring or reoccurring revenue. As a whole, you know, even our bread and butter software services business is largely recurring or reoccurring just because, you know, I mentioned the Saudi tech talent scene isn't as developed as other places in the world. They really need to rely and lean on companies like NTG to fill out their software development teams. It results in customers are not signing on with us for a single project that they, you know, basically NTG shows up, develops it, deploys it, and then packs up and goes home. They're really hiring their IT departments, their software development teams through NTG. Our employees will effectively be working on one project in the roadmap, roll it out. Yes, they'll be doing support and maintenance, but then they'll go on to the second project on the roadmap and so on and so forth. It really makes our employees become fully integrated parts of their software development teams and makes the recurring revenue much easier to come by, right? Overall, probably above 80% of NTG's revenue is considered recurring or reoccurring, either in the sense that we've explicitly got these multi-year contracts or customers year after year have been consistently renewing their annual contracts as well. Okay. On the subject of generative AI and its proliferation, obviously it affects programming and so forth. I guess it could be a double-edged sword is how it appears on the outside. What's been your experience so far? What's been the internal discussion around how you can shape your businesses as that becomes a bigger factor? Definitely. Yeah. AI is becoming a bigger and bigger part of the news cycle for sure. We see it internally as definitely an opportunity for our lines of business for sure. What hasn't been the case and hasn't been the experience of the software developers in the field has been this sort of, you know, we can completely replace software developers with AI, that kind of thing. What has been the case is that AI is an incredibly useful debugging tool, maybe even go as far as writing very simple functions for your programs. It really is a sort of productivity booster to the existing developers that we have. We have had success exploring how can we equip the software developers that we employ with AI tools to make them more productive and therefore provide more value to our customers because that's what we're after at the end of the day. We really see it as more of an opportunity and a place to enhance our developers and potentially even integrate into our own software offering to offer enhanced capabilities that way. Yeah. Can it sort of help your margin profile down the road where you can take bigger contracts with less actual resources? I mean, is that what you're kind of alluding to? I wouldn't say, yeah, definitely, you know, when it comes to implementation projects, larger scale projects with less resources is definitely a good way to put it. Also, if NTG developers are using AI and maybe another company's developers aren't, we might be able to price at a premium just because of the productivity boosts as well. Also, I touch a little bit more on the ability to maybe integrate it with existing software solutions, right? One of the projects that we're working on internally is integrating these large language models into our NTG Apps software and sort of, you know, maybe you can have a chatbot that trains users how to use the software or maybe, you know, AI in general is going to be producing reports. Like one use case we're working on is helping sales staff basically take new opportunities, scope them out, price them out, and really become a productivity booster for sales staff as well. There are a lot of opportunities, yeah, to take advantage of AI, help with our efficiency, and maybe build a little bit more for the work that we're doing. Yeah. Okay. Maybe just thinking beyond Saudi Arabia. I mean, it's a huge market. There's obviously a lot of running room there. You're in the region. There's obviously a lot of these other countries that have similar sort of vision statements similar to 2030. What are your thoughts on expanding beyond Saudi Arabia? I know that I see some revenue lines in Iraq and I think Oman. Thinking of the larger markets, UAE, what are your thoughts on expanding into those regions? Yeah, that's a really good question. It's something that we keep at the top of our mind for sure because you can think about our offering, right? What's at the core of it is having a workforce that's based out of Egypt and being able to service Arabic-speaking countries in their time zone, really sharing a cultural background while still being cost-effective. That sort of value proposition carries really well into other Gulf states. You mentioned Iraq and Oman. We have some established operations in both those countries that contribute a couple of% each of our total revenue. Other places, Kuwait, Qatar, the UAE, they all have Vision 2030 style initiatives where they're seeking to diversify their economies away from oil and gas and really technologize. It's something that we're keeping in mind in the sense that we always want to stay grounded and realize that Saudi Arabia is the largest market in the region. It's growing extremely rapidly. We're only 0.1% of the total market. Our focus should be on taking advantage of the Saudi market as well as we can. Next to that is thinking about how can we make entry into some of those adjacent markets. Our experience has been the best way to do it is to build a 20-year track record and get the business that way. What's probably the next best way to do it is to start thinking about short-circuiting that and maybe engaging in some M&A activity to roll up some smaller scale IT services companies that would have customers in Saudi Arabia or in the Gulf that we don't have. Maybe be a company that, say, NTG Clarity was like five years ago, maybe a little bit under the radar, undervalued, but has a decade and a half track record in the region. Roll them up along with their relationships. Even better if their customers are these sort of blue chip customers that we have where they have a lot of room to grow their IT budgets in a similar way that NTG Clarity expands its contracts these days. That's sort of how we think about it. It's definitely something that's going to be on top of mind to expand and maybe get a little bit of inorganic growth going. Okay. That kind of brings me to the balance sheet question because you're essentially, like even before the acquisitions, you're close to net cash positive. This takes you further. I mean, you're cash flow positive, obviously working capital kind of swings. When you think about capital allocation, is M&A the top of the list or do you have any other plans, buybacks, the whole gamut? That's a good question for sure. I mean, when we're thinking about capital allocation, you're right. Over the last year, we've been pretty consistently cash flow positive from operations, and we're just riding the line between having some free cash flow coming through as well as we grow. When I think about capital allocation, I would really stress that the number one growth driver we see right now is the continued organic growth that we have in Saudi Arabia, right? We have a lot of the connections that we need to keep the growth going into the future years. I think the number one use of capital is going to be investments into those organic growth levers, right? We're going to be opening new offices in Egypt to support the offshore center. We're going to be hiring resources to be servicing customers for these new contracts and just really supporting the organic growth that we've been seeing first and foremost. I think what's probably going to be one of our more secondary considerations is engaging in the sort of M&A that we were discussing today, right? I think it's a huge opportunity to get some inorganic growth going. The opportunity for the organic side is just so huge. I think it has to remain our number one priority for sure. Okay. Anything from the room before we close? Awesome. Thank you. Right on. Thanks very much, Aravindra. It's great.